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Institutional Reform – AECI

Having focused mainly on drafting plans, the burning issue – reform of the delivery structure, most notably the agency – has been delayed.

Nearly all of the above mentioned policy areas depend on reform of aid delivery institutions, most notably the AECI. Although AECI merely implements a quarter of all ODA, its reform would be the centrepiece of more agile and strategic aid provision. The funds administered by AECI have risen from under 300m EUR in 2004 to over 760m EUR in 2007. It is widely.acknowledged that, ahead of any other initiative, institutional reform should have been the priority from 2004 onwards. It has been seriously delayed. The AECI was at the heart of the DAC review diagnosis in 2002, and nearly all the criticisms are still valid.
Here are some features of the AECI and its respective challenges that need to be tackled in the new statute.1

  • The Agency, rather than being one body, is an inherited conglomerate of diverse institutions that still persist with the staff and organizational culture. Some departments still seem to maintain their autonomy.
  • The agency is organised according to geographical responsibilities. Although agency staff are involved in the development of sector strategies, there is no systematic concentration of expertise within AECI. As one development expert put it: “AECI field staff don’t have a phone number to call when they have questions on sector issues.” Accordingly, AECI cannot play a role as convenor for technical debates on best practice in development. The development law of 1998 assigns the role of aid management to the AECI, albeit without any effect on the powers assigned to other bodies [“sin perjuicio de las competencias asignadas a otros Departamentos ministeriales”]. If direct interference in other government departments is neither feasible nor desirable, intellectual leadership by AECI could at least streamline all policies, including those administered by other departments or sub-national entities.
  • One of the biggest hurdles is the gap between country offices and headquarters. For reasons concerning the formal status of employees, it is virtually impossible to switch between ‘the field’ and headquarters.
  • In addition, there are distinctions within the staff, some of them being diplomats, others civil servants, and others state employees. There is no strategic human resource development strategy, and the attractiveness of AECI, both in terms of salaries and job advancement, is not enough to draw on, retain and develop highly qualified staff. Staff development would have been backed by a comprehensive policy on development research, and, in cooperation with universities and the leading figures in Spanish Development Studies, on academic teaching. All in all, it is reported that morale within AECI is at a low point. Partly this is due to the heavy workload imposed on the agency due to the frenetic planning process, and partly to the long-awaited organizational reform and the insecurities it has generated.
  • Country office representatives (Oficinas Técnicas de Cooperación - OTC) have no delegated power, and are responsible to Spain’s embassies, staffed by diplomatic personnel with often little training in development issues. Similarly, beyond the usual remarks on “excellent coordination”, there is scant cooperation between OTC and the Export and Trade Offices [Oficina Economica y Comercial]. These latter report to the Ministry of Trade and Commerce, and aim to promote Spanish exports while administering the credit line of the FAD.
  • Until now, AECI has been placed in a straightjacket of bureaucratic regulations, making it a body for the accurate administrative accounting of funds spent rather than a provider of technical services. The new legal format is expected to solve this, with debate underway on how the financial accountability of taxpayers’ money and operational flexibility can be reconciled.

In mid-2005, the government approved a law of state agencies, allowing for the application of new public management procedures such as the delegation of responsibilities, results-based management, financial autonomy, and more independent human resources management.2 The institutional design plan has not been published since then, and insiders doubt that the first budget under the new regulatory framework will be implemented in this legislature. Large parts of the delay must be attributed to the complexity of negotiations. Amongst the many actors are the diplomatic service, defending its position, the Ministry of Economy, claiming financial oversight, and the Ministry for Public Administration, striving to maintain control over staffing issues and procedures.

Since 2004, however, some changes have been made. A number of staff in headquarters and field have been recruited, and precarious employment conditions have been improved. Within the cabinet, an office for humanitarian aid and a task group for ‘new aid instruments’ have been created. Nonetheless, the announcement of the new statute has not taken place. During her first appearance in the Development Commission, Secretary of State Leire Pajín announced that reform of the Agency would be a priority. Three years later, nothing has trickled down. It is highly questionable that the government will get the statute approved on time for the AECI to be considered in the financial year 2008. As a result, the first steps towards the new organizational arrangements would have to be taken by the new government in 2008-2012.3